Residual income is used as a performance measure in which of the following types of centers?
$\text {\underline{Revenue } }$ $\text {\underline{Investment } }$ $\text {\underline{Profit } }$

A)yes no yes
B)yes yes yes
C)no yes yes
D)no yes no

Question

Residual income is used as a performance measure in which of the following types of centers?
$\text {\underline{Revenue } }$         $\text {\underline{Investment } }$           $\text {\underline{Profit } }$

A)yes no yes
B)yes yes yes
C)no yes yes
D)no yes no

Quizplus · Accepted Answer

Residual income is primarily used as a performance measure in investment centers, where both the generation of profits and the efficient use of capital (investment) are important. It is not typically used for revenue or profit centers directly, as these centers focus on revenue generation and profitability, respectively, without directly considering the cost of capital used.

Residual Income Is Used as a Performance Measure in Which Revenue ‾ \text {\underline{Revenue } }Revenue ​

Residual Income Is Used as a Performance Measure in Which $\text {\underline{Revenue } }$